Tracing consequences both seen and unseen.
John W. PayneVote for Sandwich
Posted at 10:21 pm on May 26, 2010, by John W. Payne

This series of fake political ads for a sandwich are some of the best satire I’ve seen in a while, and they remind me of this article I wrote for The Washington Witness at Washington University before the 2004 presidential election.

John Kerry and the Other White Meat

by John W. Payne

In August 2003, I was sitting in a friend’s living room, watching the news, and commenting on Presidential politics.  I believed that President Bush’s chances at re-election looked slim.  I argued that if the situation in Iraq continued to deteriorate, as it has, and if people continued to perceive the economy’s performance as lackluster, which by and large they have, then a ham could defeat him next November.  I continue to maintain this position, but I have since realized that John Kerry’s bid to unseat the incumbent has thus far been sub-ham.  Allow me to explain.

One of the most accurate and widespread criticisms of Kerry is that he has repeatedly contradicted positions that he held earlier in his candidacy, or put more colloquially, he flip-flops.  Originally he supported the war in Iraq by voting to authorize the president to invade, then he decided the war was a bad idea, and then he said he still would have voted for it even knowing all that we know now, and so forth ad nasuem.  Of course Bush shifts his rhetoric frequently as well, most pointedly when offering brand new justifications for his war now that Saddam’s WMD have proven non-existent.  The difference between the two is that Bush’s horde of mantra chanters has successfully connected the name “John Kerry” and the term “flip-flopper” in the average American’s mind, while Bush still seems firm in his convictions.

Now compare these problems to what a ham would face.  The ham, being inanimate, would not take a single position on any issue publicly, let alone multiple positions.  It could not be called a flip-flopper, waffler, or any other childish epithet brewed up by Karl Rove.  The challenger’s campaign would rely exclusively on 527s and unofficial supporters to assassinate Bush’s character and claim whatever position happened to be popular at the time for the piece of pork.  If any of these positions turn out to be unpopular later, they can be denounced by an official campaign spokesperson as “inconsistent with the ham’s principles,” without actually having to specify what those principles are.  The campaign would only take official positions in October when it became clear exactly what people want to hear.  The ham would never hold an unpopular position, and it would never change its mind; a wiser and more resolute leader could not be found.

The other widespread, and far less accurate, attack on Kerry’s candidacy to emerge so far in the race was launched by longtime John Kerry hater John O’Neill and his group of Republican partisans known as The Swift Boat Veterans for Truth.  The conflicting stories offered by Kerry and the Swifties are tedious and irrelevant to contemporary events, not to mention that Kerry’s story is, with the exception of spending Christmas in Cambodia, probably correct.  The point is that after having made his military service the centerpiece of the Democratic Convention, he should have expected his record to be attacked regardless of the truth.

However if the ham were in Kerry’s place, it would not need to worry over such matters.  Its past consists only of trifling matters: at one time the ham was part of a swine which was eventually slaughtered, the ham was then removed from said swine, prepared and packaged.  These events are not politically provocative, and the ham would not feature them during the convention.  Instead the ham’s campaign manager would encourage the Democrats to bash Bush relentlessly and with outright malicious methods.  They could claim he eats newborn children, or that he is actually a hermaphrodite, or they could just run the video of Donald Rumsfeld shaking hands with Saddam Hussein over and over.  The specific claim is unimportant just so long as one message comes across: George Bush is wrong about everything, everyone who advises him is equally wrong, and they all lack the ability to do anything right.  It would be very simple.

If John Kerry loses this election, the fault will lay fully upon him.  Unemployment is higher now then when Bush arrived in office.  Bush sold America a war of necessity in Iraq that was later exposed as one of choice and has since turned uglier than almost anyone predicted.  He has upset his own fiscally conservative base with deficits, tariffs, and the largest expansion of Medicare in the program’s history.  Stepping into such a situation, how could Kerry lose?  Put simply, he has given Americans no reason to believe they know what he thinks about anything.  With a ham at least people know it does not think at all, and in the worst case scenario it can be eaten by a needy family, but with a person whose thoughts are a mystery, anything is a possibility.

As of late, Kerry is on the attack in speeches with some fairly consistent criticisms of the war and Bush’s economic policies, but he should have been saying these things from day one.  If Kerry had taken a position, any position that George Bush did not hold, and stuck to it since his campaign started he would be easily ahead in the polls right now, but as it stands, it seems the ham still makes the better choice.

Videos via Radley Balko.

Filed under: Politics
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Lee SharpeFinancial Reform
Posted at 11:19 pm on May 23, 2010, by Lee Sharpe

With the financial reform bill through both houses of Congress, it’s time to look at its contents, which do not look good at all for fans of limited government.

Banks are taxed to pay for bailouts. Since banks will pass these taxes on to consumers, really it means bank customers (almost all Americans) will be paying for more bank bailouts. What those who take this view fail to see is that making banks “too big to fail” means that those banks will engage in as risky behavior as possible. Did their risks pay off? They keep the profits. Did the risks not pay off? That’s not on the banks, because the American public will be covering those losses instead.

Ah, say the the more nuanced supporters of this legislation. That is this bill, to quote CNN:

New oversight power: Creates a new oversight council that would look out for major problems at large financial firms. The Treasury Department gains a key role in enforcing tougher regulations on larger firms and watching for systemic risk. The council also has veto power over new rules proposed by [a] new consumer regulator.

How much risk is too much? I don’t know, neither does the governement, and probably the firms don’t know either. But if firms are all free to be as risky as they like — receiving the profits when they’re correct and being forced to endure the losses when they don’t (even at the risk of going bankrupt) — then the market will learn which risky behavior to avoid and which works.

Instead government is guessing how much regulation is appropriate. Since the government (through creating expectations and in some cases guarantees of bailouts) is already encouraging banks to provide risky loans, if regulations don’t mitigate this enough, the banks have to be bailed out at the public’s expense. If the regulations mitigate this too much, reasonable loans that banks and recipients would both agree to the terms to will be banned by the government, slowing economic growth.

Banks profiting from their investments is good for everyone. Home buyers and small business owners often need loans to succeed. Banks make more money in the long run, which they can use to make even more loans to others. Without the government’s help, this has been occuring to the mutual benefit of investors and loan recipiants. These home purchases and small businesses create direct and indirect employment. Having bankers and investors make their own choices and receive both the positive and negative consequences of their lending decisions is a much more effective way of doing that. It also doesn’t cost the public a thing.

Filed under: Finance, Regulation
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John W. PayneThis Just In: No Return Seen on Futile Endeavor!
Posted at 11:53 pm on May 19, 2010, by John W. Payne

The AP ran a an article last week highly critical of the drug war that everyone should read in its entirety, but this quote from former drug czar John Walters really my eye:

“To say that all the things that have been done in the war on drugs haven’t made any difference is ridiculous,” Walters said. “It destroys everything we’ve done. It’s saying all the people involved in law enforcment, treatment and prevention have been wasting their time. It’s saying all these people’s work is misguided.”

Yes, that is exactly what critics of the drug war are saying, but Walters is seriously delusional if he believes this is any kind of defense of the drug war.  Just because thousands of people have expended lots of time and resources on fighting the drug war doesn’t mean it’s had a positive impact or that it ever will.  It’s like he believes in some kind of bureaucratic labor theory of value.  Walters refuses to even consider the notion that the whole effort has been a counter-productive  waste, which I suppose is understandable given that it might mean admitting that he has been a massive force for evil in the world.

Walters should familiarize himself with the old saying about hoping in one hand and shitting in the other because he would have one very full hand by now.

Filed under: Drug Policy, Nanny State
Comments: 1 Comment

Justin M. StoddardA Flagging Stupidity
Posted at 4:23 pm on May 10, 2010, by Justin M. Stoddard

“The essential difficulty of pedagogy lies in the impossibility of inducing a sufficiency of superior men and women to become pedagogues. Children, and especially boys, have sharp eyes for the weaknesses of the adults set over them. It is impossible to make boys take seriously the teaching of men they hold in contempt.” — H.L. Mencken

For the most part, the out-of-proportion response to the suspension of five juveniles for wearing clothing emblazoned with American flags to school on Cinco de Mayo is all over but the shouting. Though this incident serves as incredibly effective fodder for the ever increasingly silly (and almost wholly invented) culture war being waged at the fringes, it also reminds those of us less prone to “the vapors” to recognize what’s important in cases such as these … and it is a central libertarian theme.

Sometimes we are put in the position where we feel obligated to defend stupidity.

Let’s not be coy about it. The act of donning over-the-top patriotic garb on Cinco de Mayo was an act of adolescent sophistry. Not that I’m opposed to such actions, were it aimed in the proper direction. But this was not an act aimed against an authority or unjust policy. It was simply aimed to, well … disrupt. Being such, it was impolite, uncouth, and a bit stupid. Certainly not an action that would elicit my sympathies. Until, that is, the Man stepped in and screwed everything up.

When the principal of the California school got involved, things got a bit surreal. Telling the students that they were welcome to wear such accoutrements any other day other than Cinco de Mayo, said principal immediately made himself out to be a bit of a buffoon. When he suspended the boys for the day and sent them home, he unwittingly thrust himself and the entire brouhaha into the national spotlight, proving to everyone in America what children have known for ages: A school administrator wielding arbitrary power is an irresistible recipe for ridicule.

Don’t let’s get caught in these culture war traps. What these boys did was silly and unwarranted, a feat begging to be ignored. Any intelligent school administrator would have recognized this stunt for what it was, and acted appropriately — that is, not at all. What we have now is a principal (and the school administrators who backed him) worthy only of ridicule and censure.

Race and immigration policies are tangential, here. This is about restraint (the wisdom of knowing when to wield and when to yield the power you have) and personal responsibility, two capacities for which individuals could stand to develop more.

[Cross-posted at Shrubbloggers.]

Filed under: Culture, Education, Nanny State
Comments: 2 Comments

Caitlin HartsellThe Market at Work: Poverty in Africa and KickStart
Posted at 1:51 pm on May 3, 2010, by Caitlin Hartsell

Last week at a Liberty on the Rocks meeting, we discussed the need to show others how the market can provide for the disadvantaged better than the government can. Many libertarians may take this for granted, but this is a relatively important fact to establish in order to combat the idea that the government is necessary to help people.  I thought I’d write a few posts on the topic of “the market at work” based off a few good examples I have recently encountered.  (If anyone else has good examples to share, please do!)


For the last three class periods in my Program Planning class, we have been discussing a case study of KickStart, a company that sells treadle pumps to farmers in Kenya, Mali and Tanzania. A treadle pump doesn’t need fossil fuels to extract groundwater, so it can efficiently provide large amounts of water. It can be a cost-effective method for farmers to increase their output so they can sell their produce.

The Lessons Learned page on KickStart’s site is well worth reading in its entirety, but the main gist is that their founders were unsatisfied with the typical program model that focuses on giving away money or services, which has not been a lasting solution.  What the poor need most is a way to make money; providing reliable and long-lasting tools are the best way to help them do that.

It is the “teach a man to fish” idea.  Increasing the standard of living of an entire country requires an increase in production.  An influx of foreign aid–without a subsequent increase in production– will not raise the standard of living across the board. By creating a tool that will help farmers be more productive, KickStart can help people in a lasting manner.

Essentially, KickStart‘s long-term idea is that “creating a middle class is the most sustainable way to lift a country out of poverty.”  To do this, they have created a product that will help people become entrepreneurs.

Using the market

KickStart is different from many similar organizations because it believes that selling their products is better than giving them away.  There is an elaborate chart that explains how, because they sell the products, they are able to help three times the number of people than if they gave them away.  By commodifying the product, there is a profit motive that incentivizes each portion of the supply chain to become more efficient.   Even if the donor funds disappear, people will still be able to get pumps.

Most importantly, the price system also allocates the products more efficiently than giving them away.  When people have to make an investment, they are more likely to actually use them to create their own enterprise.  The pump makers are accountable to create pumps that fit the needs of their usersr. Because KickStart sells the product, there is a self-sustaining supply chain that keeps costs low and allows people to fix the product when a part breaks.

The Ethics of Selling?

One complaint my class had was that it was “unethical” to sell these treadle pumps because selling exacerbates socioeconomic differences, since those that can afford the pump may be slightly better off already.  Inequity is a hot topic issue in many of my classes.  While inequity is a problem, I think that the focus should be more on how low the bottom is, as opposed to how different the bottom is from the top.  Helping people up from the bottom should always be seen as a good.

But the part that is missed is the effect that something like a treadle pump can have on an entire community.  When a few people are able to raise their standard of living, more money is brought into the community.  This money is spent on other businesses in the region, which can benefits other people, whether or not they purchases a pump.

Also, the “early adopters” help establish the supply chain and find any “bugs” within the product.  Over time, the supply chain and technology will improve both the efficacy of the pumps and their cost, allowing other people to buy the pumps.  These market forces have been seen in many products; by selling the pump, the proper incentive structure is set up to improve the pump and to determine the method to provide it in the cheapest manner possible.  When one looks at KickStart’s data showing that they can help three times the number of people by selling instead of giving the product away, it seems unethical to not sell the pumps.

Their Success

How successful has KickStart been? We’ll find out after the pending independent evaluation, but the anecdotes seem to show that it has made great strides for many involved.  According to their own measures, they have sold 144,600 pumps, helped create 93,200 enterprises, helped 466,000 people out of poverty and generated $94 million in new wages, which is fifteen times the amount of donor funds.  This means it took about $60 to get one person out of poverty.  Whether or not these results are overestimated, it is still an impressive impact from one organization.

Most importantly though, KickStart is affecting real, cost-effective change that doesn’t rely on government intervention. Emulating and promoting their model elsewhere is one way to show people how the market is the best mechanism to really help people.

Filed under: Economic Theory, Market Efficiency
Comments: 2 Comments

Henry Hazlitt"[T]he whole of economics can be reduced to a single lesson, and that lesson can be reduced to a single sentence. The art of economics consists in looking not merely at the immediate but at the longer effects of any act or policy; it consists in tracing the consequences of that policy not merely for one group but for all groups."
Henry Hazlitt, Economics in One Lesson






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